Don’t take my word for it.
I speak to a lot of business people around Australia and no one – yes no one - I have met in the past few months disagrees about the need for the government to do something immediate to get the economy back on track. In the mean time, their businesses are suffering and their willingness to hire and invest is severely constrained. There is unanimity from financial market economists that fiscal policy needs to be eased to get the economy back to full health. These are not the loonie left types – they are arguably some of the best practical economic types in Australia.
In simple terms, there is an urgent need for the government, your government, to pump some money into the economy via the tax system and spending if you want to not only avoid higher unemployment, but to actually get the economy back to full employment.
You are the Federal Treasurer in a Liberal Party government. The Liberal Party claims that “low taxes” are in its DNA, yet your own budget documents show you will be one of the highest taxing Treasurers in Australia’s history.
How about giving back a bit of the tax and unspent funds sitting the government’s coffers to the private sector so that they can be the driver of growth and job creation and complement the policies of the RBA in getting wages growth and inflation back to a decent level?
It is easy to do.
A few strokes of a pen and a fast track of the required legislation through the Parliament and before year-end, some extra cash can be in the hands of those who will spend, invest and employ.
I would welcome any opportunity to meet with you to further discuss these matters and to outline some key areas where pro-active fiscal policy can help deliver growth. I cannot recall who said it, but if the government of the day gets policy and economics right, they get the politics right.
Just think, going to the election in 2022 with the economy going strongly, with the unemployment rate in the low to mid 4 per cent region and with wages growth accelerating?
You’d be Winx-like odds to win.
I look forward to hearing from you and trust you can deliver a policy framework that lifts economic growth, lowers unemployment, increases real wages and bring better times for all Australians.
Managing director, Market Economics